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tv   Closing Bell With Maria Bartiromo  CNBC  April 21, 2010 4:00pm-5:00pm EDT

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we saw the stocks droop a little bit and the big financial stocks like bank of america and jpmorgan and citigroup. bank earnings are coming into trend simple here. credit trends are improving and that is the single most important thing that the stocks trade on, and the biggest banks are also doing really well in terms of the trading profits of course, especially on the fixed income. here is one problem that i saw. i don't see any long growth. wells fargo said that specifically, and we better start to see it in third quarter at the latest or troubles here. overall, the rest of the market, demand is improving and top line is improving and looking at the companies, and seagate has record shipments, and united technology, and temple-inland who make the corrugated board that everybody sends out, and packaging, the volumes rising and trucking and c.h. robinson and shipping volumes up 22%, and these are excellent numbers and the airline airtran said they are experiencing significant passenger demand.
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we had some weak innocence ness health care such as gilead sciences who had a disappoint and lowered guidance. why did they do that? simple. impact of health care reform which will start to affect a number of the companies. abbott also trimmed the forecast on health care reform. finally, the companies are dow earnings and new highs for most of these, boeing, united technologies and mcdonald's all reported good numbers. maria, back to you. >> thank you, bob pisani with the latest news there. late today in the verdict of the former ceo of k.b. home accused in a stock option case. jane wells has the story live in los angeles. >> well, bruce carrots has been convicted of 4 of the 20 counts he was facing in federal criminal court on the charges he profited millions by secretly backdating stock options while at k.b. homes. however, he was acquitted to the counts of actual backdating.
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he was convicted on the cover-up of the activity and those convictions are mail fraud, and making false statements to the s.e.c. the u.s. attorney offices says he faces 60 years in prison based on the convictions, because that is up to the judge when the sentence is handed down in september. the stock shot up this afternoon after the verdicts came out. and prosecutors have had mixed results with the stock option cases, but this will make it certain. but it is not the backdating that the jurors considered the crime, but the cover-up. back to you. >> well, isn't that the case. jane wells, thank you very much. meanwhile, goldman sachs ceo lloyd blankfein will appear before a senate panel about the mortgage crisis and he is expected to answer questions about the fraud charges by the s.e.c. against the company. and john paulson is reaching out to assure investors. scott cohn has results of a conference call he held today. >> well, maria, is the second conference call he has held this
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week, even though he has not been implicated in the s.e.c. case, we are told by an investor on the call, that it was calm and many people taking the opportunity to get his views on the market, since he is a guru now, but he also was asked if there were other deals like abbacus 2007, the deal in question, and while paulson did acknowledge taking part in other collateralized debt obligations in the market, a source close to his investment says that this is the only so-called synthetic cdo meaning it did not contain the actual mortgages, but instead, derivatives of mortgages and that is important because the s.e.c.'s complaint against goldman sachs says it is the synthetic cdos that impacted the housing downturn. maybe this is why paulson is so active with the investors including a letter to investors obtained by the cnbc. he says he disputes that he was secretly pulling the strings on the deal. he did not structure or originate the abacus transaction and would the investors have
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cared if he was involved back in 2007, but paulson does not think so. prior to the market collapse, mortgages were viewed as among the safest investments possible. yet, no one disputes that he played a role in structuring the abacus deal, and that fact was not specifically disclosed to all of the investors. the s.e.c. says that that amounts to fraud by goldman sachs, and goldman sachs disagrees, and does john paulson? well, maria, you be the judge. >> interest stuff there, scott. other break news here and let me get to the breaking news desk at headquarters, there is mike huckman. >> starbucks beat the street and raising guidance, and they reported that quarterly revenue came in at 2.5 billion and the consensus was $2.4 billion on earnings per share, and they are reporting eps of 29 cents and the street consensus was 25 per share and they are raising the full year eps guidance and previous think company said look
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for $1.05 to $1.08 and it was $1.12 and now the company saying it expects 2010 range to be $1.19 to $1.22 a share, and finally the strong same-store sales comps up in the quarter saying it is driven by a 3% increase in traffic and 4% increase in the average ticket. back to you. >> thanks so much, mike huckman with the latest there. general motors is paying back the government loans well ahead of schedule putting the automaker in place of -- in terms of paying the money back, a lot of people are talking about that being a real surprise that gm is able to pay that money back. well, we told you earlier about that verdict in the case of bruce carries, and we will have more on that coming uch, and in the meantime, we are looking at a market up 8 points at 11,124 with the nasdaq also higher by
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about four points, as you can see there. the nasdaq is higher, but just by a fraction there. we are going to take a short break and then we will be right back with a lot more "closing bell." stay with us.
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good afternoon, everybody. tyler mathison at the breaking news desk with engines results and they are good on the eps number, $1.30 versus the estimate of $1.23 and lighter on the revenues of 3.9 billion versus estimate of $3.65 billion, but here is the key number. the key number here is that the company says that they are now forecasting on revenues and eps for 2010 to come in at the low side of the early range of estimates. that means on eps 505 to 520 and low side there, and on earnings, excuse me, revenues 15.1 to $15.5 billion and again,
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expecting the low side there on revenues. so, we will watch the stock and there you see it moving down now, and moving down apparently from the 4:00 p.m. close. once again, a beat on the top line and a narrow miss on the -- excuse me, a beat on the bottom line, and a narrow miss on the sales number. back to you, maria. >> all right. thank you. tyler, the stock is getting reaction as you said with the decline there. and general motors is paying back the government loans well ahead of schedule and putting the automaker firmly on the road to recovery at least it looks that way. phil lebeau is in kansas city, kansas, with that story. phil? >> well, a huge day for general motors at the company's plant here in kansas city. ed whitacre, jr., announcing that gm has repaid the entire $6.7 billion it was required to pay when it came out of bankruptcy and now the focus for gm getting back into the black. >> as of today, general motors has repaid in full and with
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interest -- >> reporter: sounded by 3,700 loud and happy gm workers, chairman ed whitacre, jr., made it clear that automaker is turning the corner toward profitability. >> i won't speculate and wait until you see the first quarter results, because you will be impressed. >> it is impressive they are ahead of schedule with the financial performance and some of that is because the auto sales are picking up, and another factor is a slim down and more focused gm doing better competing and controlling costs. >> last month was a big month and a lot of the incentives came at the market and toyota leading the market with incentives and old gm would have thrown money at the market to catch up with anyone else, and this gm is showing more discipline and you will see it in the discipline results. >> ipo this year is a strong possibility, but before that, the analysts want to see if the gm rebound can last. >> these are positive signs, but they are not out of the woods yet. we have a ways to go, and i don't think they will be able to go public on the time frame any
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time soon. >> for gm workers in kansas city, there is optimism building with every malibu that rolls off of the line. >> well, it was great news for general motors and fairfax here, and good news to get the money we needed to pay the government back. >> we are excited about it. you know, that means job security. >> how much job security? well, gm is now running three shifts at this plant. they will add another 900 jobs which is a commitment to sink more money into the plant they announced today, maria, general motors is now faced with a good problem for a change, finding more capacity, because it is undersupplied right now, and you would rather have that than oversupply, maria. >> thank you, phil lebeau in kansas city. a new ponzi scheme is highlighting the headlines. the s.e.c. is charging capital investments founder and president nevin shapiro for allegedly running a $900 million ponzi scheme. the miami beach businessman is
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accused of running a scheme to fund his lavish lifestyle including a boat and basketball tickets and paying off gambling debts. and the industry reports that oil supplies jumped by 1.9 million barrels, and oil is expected to slip to close at $83.68. and the coast guard says it has not found 12 missing workers following an explosion on a oil rig in the gulf of mexico. the blast critically injuring seven other workers. it is unclear what caused that explosion. ebay out with the first quarter numbers today, and we will talk about this coming up, and earnings for flashmaker sandisk are hitting the street right now. the company earned 97 cents a share well above estimates on revenue of $1.1 billion. and joining me in an cnbc exclusive is eli harari. good to see you again on cnbc. >> hi, maria.
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>> can you characterize the xwa quarter for us? >> well, it is a very good quarter, first quarter and first time we crossed $1 billion mark, and really generating tremendous amount of cash flow, balance sheet now up to $3.3 billion in cash and investments. very stable pricing conditions through oth the quart -- throug quarter, and much less cost reduction than we expected and we are now in a much more diversified company, so it is feeling very, very good. >> let me ask you this, eli, the analysts at pacific crest, and this is kevin vasili and you saw the report he downgraded the company's stock based on the view that flash memory, the whole flash memory model was changing from one of growth to a cyclical business. do you agree with that? how do you address the challenge? >> well, you know, flash is everywhere. every consumer electronic
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product, and every iphone, and every ipod, and every gps system in your car stores its information in flash memory, so, this is -- and frankly, the mobile revolution, mobile internet is very, very much dependent on the flash memory. we think that most people don't fully appreciate how large flash is going to be in the next deca decade, and certainly, already a very large market, but it is becoming from a commodity market to a strategic commodity, because it is difficult to manufacturer it, and we are really at the top of the line. >> eli harari, stand by, because we have breaking news on ebay and we want to get the numbers and i want to talk to you about what is going on with the consumer right now and may very well get a window into this with ebay coming in over to jim goldman with the headlines? >> and maria, good eving if to you. looking at the numbers here, because it is looking like a good quarter. we will talk about the guidance which is where the softness coming from the company and the stock. 42 cents beats the street by a
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penny per share, and on non-gep $2.2 billion, and slight beat when you can take it, but some say that is also in line. looking deeper, we look at the second quarter guidance and the individual metrics. the nongap range that ebay is providing for the q2, 37 to 39 cents a share, and the street at 40 cents and some discussion that ebay would beat that, so that the 37 to 39 non-gap eps might be deemed disappointment, and in fact, a lot of disappointment if you see the way that the stock is trading. looking ahead, revenue 1.5 to 2.2 billion is the revenue range and also below expectations as far as the street is concerned. and also, the street providing a $1.68 and $1.67 is what the street was providing so this is
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lower and inline with expectations of 8.8 to $9.1 billion and i will have a wrap-up of the blog,, but it looks like ebay is selling off on the news. >> well, ebay under some selling pressure here. than you, jim. we will continue to look at this. back to eli harari, and we got the earnings from ebay and that is one area of technology that we have actually seen a lot of movement recently. tell me, eli, where you are seeing the strength in terms of the chips going into some of to consumer products out there that have been so really strong in terms of usage, as we saw from apple's numbers last night. >> right. so, the mobile, let's handsets, worldwide, it is rapidly and the smartphones growing rapidly and 40% of the revenues from q1 came from that market and double what it was last year and that market
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didn't exist five years ago and it is a young market. if you look at india, and china and these geographies and the market for mobile phones is growing leaps and bounds, and then right behind that is right ahead of it is a disk market in computing. so we think that a huge market opportunities for flash memory in the next decade, and that is really what is fueling our optimism. >> all right. we leave it there. el l eli harari, thank you for being on the program and giving us updates on your business and the industry. appreciate it. >> thank you. >> and up next is president obama taking his picture of reform right to wall street. he first spoke to john harwood in an exclusive interview. the barack obama interview coming right up. national car rental knows i'm picky.
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all right. welcome back to "closing bell." president obama talking exclusively to john harwood today ahead of the big speech on wall street. he is with us from the white house with the highlights. hi, john. >> well, maria, the head news headline maker was the president categorically denying any interference with the s.e.c.'s case against goldman sachs, and as a matter of fact, he said he first learned about the lawsuit against goldman sachs from cnbc. now, we also talked about
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financial regulation which is moving forward and closer to a deal on capitol hill, and tax policy moving forward. let's take a listen. >> we have to have a thriving financial sector. because essentially, part of what has made america so successful is our ability to, if we have a dream and we want to go get some financing for the next apple computer, the next ipod, the next, you know, invention out there, that we are able to go and get investors to finance our dream, and make it happen. so we have to have a thriving and effective financial sector. >> so it is god's work? >> well, think it is very important work, but we also have to have basic rules of the road in place to make sure that investors, consumers, shareholders, the economy as a whole are protected against excess, protected against wild gambles are taken purely because
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it is good for somebody's year-end bonus as opposed to there is some economic function that actually contributes to society as a whole. i think that throughout our history, there had been times where the financial sector swung way out of balance. that is part of what happened back in the 1930s, and 1929 after the crash. and fdr came in place, and said, we are going to set up some rules so that we don't have bank runs, so that there is not wild speculation. we have gotten into one of the places where we need to update those rules of the road. and if we do so, not only is that good for the economy, not only does it protect consumers and investors, but it is also good for the financial sector, because it will rebuild trust and people will have confidence that when they are dealing with the banks or dealing with the institutions, that they in fact are playing it straight above board and competing on the basis
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of who is providing the best services and best products as opposed to who has got the most creative accounting rules or who is able to concoct the wildest derivatives that may serve no economic function whatsoever. >> you have to have a tax bill this year, otherwise when the bush tax cuts expire, taxes go up for everybody. >> right. >> is there any way that you would accept either on a temporary basis or a partial temporary basis the preservation of some of the bush tax cuts for the top end? >> i don't think that we can afford it. look, i just paid my taxes, and i had a pretty healthy bill. i am sympathetic to the fact that people would prefer paying fewer taxes. that is part of the reason why as part of the recovery act, we cut taxes for 98% of working families, because we thought it was important in a recession to make sure that people got a little bit of help. but as we go forward, if we are going to be fiscally disciplined, we have to do two
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things. we have to cut programs that are not working, and show restraint. >> and, maria, you see the president keeping his options open on taxes to try to preserve the flexibility when we get to 2011 to take an attack on the deficit and notwithstanding the cam page pledge of no tax increases for those under $200,000. >> and leaving the door open for raising the taxes on everybody. thank you, john. sorry it is raining on you. great interview and we appreciate it. john harwood at the white house. i particularly liked what the president said no coincidence of pushing financial reform and the fraud charges against goldman sachs. speaking of coincidence, try googling goldman fraud. we got a chuckle when we googled goldman fraud, because when we did, what popped up? an ad for the president's financial reform.
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help change wall street, it is time for financial reform, and that is one of the subjects of the trading desk and given the speculation of the political undertones googling goldman fraud will get you to the ad organizing america and insuring that financial reform gets passed. coincidence. and credit concerns don't look to go away in europe any time soon. and some evidence that things may be getting worse. and our strategist jordan kotick is with us on the tick by tick. jordan, good to see you as always. let's go for it. german versus the greece 10-year? >> well, everybody knows problems with greece, so recognize what is going on despite the moments of stability in the charts, what we are seeing is is a spread continuing to widen out, and no matter what happens, the spread is going to the top side and we have come 370 basis points this year in the spread alone, and it is up to 500 basis points, and the market is saying still problems
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in greece, and no confidence in that, but the problem we are seeing, maria, is contagion and we have to start to talk about it. >> joe, that will impact the u.s., right? >> absolutely. a sign of confidence. now, everyone is aware of what is going on in greece, and we want to turn the spotlight to port ugal and here is why. as soon as we can rough it up, here we go. the markets at a thrust of 150 basis points and not far away of taking out the highs and this is looking like greece not six months ago and our concern is that once we start to take out the highs, we could have a start run to the top side. if that is the case, and the market is saying like a thief in the hotel knocking on each door one by one, greece is in the limelight, and now knocking on portugal and not in the public yishgs beye, but if it keeps going, portugal is in the eye. >> and not to mention the worries of the volcanic ash. thank you, jordan kotick. and the vol cannic ash has
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had a huge impact on iceland. we will talk to the president of the country in a few moments. and raymond james will be was and tell us how president obama's financial reform will impact the country. and also, we will look at the earnings scorecard and see which companies are the winners and the losers. back in a moment. here is a look at some of today's winners and losers.
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>> welcome back. breaking news after a volcanic eruption in iceland grounded european air traffic for five days, officials in the continent on the continent are reopening the space to commercial flights. there are more concerns of volcanic ash though. the president is warning that a bigger and second volcano is set to erupt. joining me live is the president grimmson. good to have you on the program, mr. president. >> thank you very much. as always, it is a great privilege to speak spoo to you.
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>> it is our privilege as well to hear from you. can you tell us what emergency plans you have under way in preparation for the second and much bigger volcanic eruption? what are you expecting? >> well, first 06 alof all, we know if that eruption will happen in five years from now or ten years or earlier. we have for a number of years created extensive rescue plans and civil authority plans to deal with the eruption, which of course, will have dramatic consequences for air transport in many parts of the world. i think that what we have to realize that this eruption that we have seen in the last few days and some others that might come in the next 20 to 30 years will test global aviation in a new way. so, both the airlines and the companies that produce the airplanes have to take a fresh
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look at how the airplanes are equipped to deal with the natural disasters of this kind. >> so, mr. president, can you tell us and characterize for us the impact this has had on the iceland's economy? >> well, it is difficult to say, because the big impact, of course, well beyond the tourist sector, of course, we have had a lot of consolations in the last few days and probably in the coming weeks, but hopefully in the coming months and years people will be interested in coming to iceland and see for themselves the mountain and the ice and the lava that had the dramatic consequences all over the world. because, to summarize it really, what we are seeing in my country is the creation of the world in full force. we read about it in the opening of the old testament in the book of genesis, that god created the earth in six days and then the work was finished, but in
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iceland, it has continued. so, if the tourism sector can benefit from the tension, the economic impact will be primarily on the local farmers and community, but the nation is coming together to help them, so hopefully in two or three years' time, the farming in the area will be back to normal, and we will be able to in the coming months to welcome people from all over the world who come to be interested in coming to the country to see this for themselves. >> i see. so you think that this could help tourism down the road, because of people's interest in seeing the volcano and the lava. >> yeah, and also, witnessing for themselves these emore mouse forces of nature which are on display in the country. you can observe them very safely and confidently in iceland. i have also heard in the last few days that even some artists and designers are interested in
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using the ash and the lava to create new pieceses and and so to bring pupils and students who are interested in the environment and nature to observe, because this is the first time in modern history after the world war ii that we see a glacial eruption of this kind that has an impact in europe on the united states. >> let me ask you about the eu's response to this volcano crisis, sir. it has been described as inadequate, do you agree? >> well, first of all, our top priority here in iceland when the volcano erupts is safety above all. we are very pleased in iceland that throughout the days, nobody got hurt. nobody was killed, not in country and not in any european country, but quite frankly, the european authorities and the aviation authorities especially, they have to take a very close
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look at the transport system in their countries, because eruptions of this kind will happen in this century. we don't know when. we don't know how often, but they will definitely happen. and so, there is a need for comprehensive reform and examination of the entire aviation industry in light of this experience. >> well, the air transport association is estimating $1.7 billion in lost airline revenue as a result, and you are expecting another volcanic eruption. will you be providing any financial support for your country's airlines if needed, and how do you think they are going to get through this? >> well, as i told you earlier the paradox of this is that the airport in iceland has been open, and throughout these days, everyday there have been planes going between iceland and the united states.
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so, whereas the ash cloud has been moved over the europe and had the impact over the traffic in europe, the iceland airport has been open throughout this entire period, so our airline has not perhaps suffered in the same way as other airlines and that is a paradoxical situation, but the other people in the area of the southern part of iceland and the farmers and the local communities have suffered economically, but as i told you before, this is the first time after the world war ii, after modern aviation became an intricate part of our economies and way of life that an eruption of this kind happens. but they have happened throughout history, and once or twice or three times every century, so the airline industry and transport authorities in europe and elsewhere have to start planning for these
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eventualities in the coming years. >> and there was a report released today saying that the recession was less than expected in iceland, and what do you expect for the country's level of debt which is 105% of gdp and how are you reducing it and tell us what is on the agenda now in terms of getting the fiscal house in order. >> well, i'm pleased about the imf report, because it confirms what i have been saying for about 10, 12 months or so, that the inherent strength of the e icelandic economy to get over this in a more formidable way than people expected. why is that? the devaluation of the currency has helped the many export companies in iceland that. the fishing sector, and the clean energy sector and the software sector and the
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high-tech sector and tourism. so we have seen many different aspects of the iceland companies doing better than before, and in addition the entrepreneurial spirit of the country and the creativity of the people has brought forward many new companies in very interesting creative sectors. so, in a way, we believe that towards the end of the second-of the year, we will see growth coming up again. unemployment in iceland fortunately has been less than the operation since the banks collapsed. it is less than in many of our neighboring countries, so in a way, due to the economic policies, the effort of the nation, and how we have all come together, we will get out of this crisis earlier and more effectively than most people predicted. >> mr. president, we so appreciate your time today. thank you so much for joining us, and giving us the update on
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the extraordinary situation. >> thank you. >> and olafur grimmson joining us, the president of iceland. and minutes away, the results are coming out off of the wire, and we will talk to the chairman and ceo of raymond james financial, and we will talk about what regulatory reform means for his business and that is coming up next on cnbc. hey can i play with the toys ?
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welcome back. raymond james releasing the second quarter results moments ago and it is the last earnings reports that the company will issue under the guidance of current ceo tom james. he is set to step down in may, and he joining us with an exclusive look at how the firm faired in the second quarter. he is chairman and ceo with raymond james financial. good to have you on the program, sir. >> good to be with you, maria. >> characterize the quarter for us? >> well, it was excellent, and the revenues were obviously up a lot, 28% over last year's comparable quarter, and the more impressive thing, they were up 7% successively from the succeeding quarter and profits up dramatically from $56 million up from $6 million last year, and up from $42.9 million in the immediately preceding quarter. so what i would tell you is that
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the improvement in the financial markets is being reflected as slow growth occurs in the economy, where we are somewhat in front of that, which is fra dissional. so actually, almost all of the business are improving quarterly as we go forward. >> so, would you say that the risk trade or the mental i the for taking on risk is back into the market? tell me what is the mentality of the investors from your standpoint? >> well, they obviously feel better with the standard and poor up 70% year to year, and dow jones up 50. so, yes, they are back in the marketplace, and the most of their losses have been recovered. their attitudes are positive, and the corporations are back in the market raising new money to refinance their balance sheets. so, we are actually in really good shape, i would tell you in our industry, and as long as the economy continues to improve at a somewhat faster rate than anticipated i think, we will
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continue to do well although we are subject to interim corrections in the marketplace. >> let me ask you about financial reform, sir, because one of the uncertainties out there for your colleagues in the business, seems to be the idea of not knowing what capital requirements will be. tell me about that, and what should capital requirements be, and do you think that we will get clarity on that once we do get financial reform? >> well, there is no question that capital requirements need to be raised from the levels that existed prior to this decline. they have already really practically raised the level of capital in the banking industry. in the investment banking industry, they have made exceptions for the major investment banks, and as a result, they had too much leverage. so, i believe that we are going to see the old standards with the appropriate haircuts for
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illiquid assets in both broker dealers and in banks going forward. so, i think that those changes will be positive. and most of the changes, as you know, the industry has been reck -- making recommendations to improve capital in the government supported mortgage operations for some time. fannie mae and freddie mac. and they went on heated because of the political power of those institutions, and that is one of the major causes for the downturn here. >> right. >> we really had inadequate capital there. >> and larry fink, earlier in the program, he told us that he thought that the most important itemthe agenda of phi fln shall reform is derivatives. do you agree with that? >> i agree with that. i think we need derivative exchange, and more clarity of
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what is involved in those derivative securities, because the opacity declined farther along the value that was realized. >> are you looking forward to 2010? >> i am. we are subjected to a risk of collapse, and i think that the earnings will surprise people on the upside as will growth of gdp. >> leave it there. sir, thank you for being on the program, and we so appreciate your time. >> thank you, maria. and thank you, thomas james, raymond james kceo and chairman there are new developments in the allan stanford case, and those details are next up. time now for "going glowball europe." >> i'm lieu wa is a boorstin, and these are the stories with rewatching tomorrow. we will bring you the latest as airlines struggle to get back to normal and clear the flights. after six days of chaos from the volcanic ash almost brought the
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airline industry to its knees. plus, we'll also be keeping an eye out as credit suisse announces their first quarter results. we'll be speaking to the ceo, and we'll be asking him what his outlook is for the bank sector for the rest of 2010. tune in to cnbc world to catch all of the action overseas. at cnbc's european headquarters i'm louisa bojesen going global with your money. with fidelity, you can take your trading around the world, because now you can trade u.s. and foreign stocks online, in 12 markets, 24 hours a day, all from the same account, and settle in u.s. dollars or the local currency. plus, we'll guide you with international research and realtime quotes, so you can diversify your portfolio, wherever -- whenever. and we'll be on call around the clock, while you trade around the globe. fidelity investments. turn here.
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welcome back. new developments tonight between the s.e.c. and allen stanford. cnbc's senior correspondent scott cohn now on the story. scott? >> maria, it keeps getting pushed into the background but that inspector general's report on the s.e.c.'s handling of the alleged $8 billion stanford ponzi scheme, the report quietly released in the middle of the furor over goldman sachs on friday, is getting lots of attention nonetheless among investors of course but also on capitol hill. and we've been comparing that scathing report by inspector general david cotts to the s.e.c.'s public statements since the scandal broke last year, and some of the contrasts are striking. in his 159-page report last week
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inspector general david kot sachlt concludes, the s.e.c. enforcement division made no meaningful effort to investigate the potential fraud or stop it until late 2005 even though examiners knew about it since 1997. compare that to last august. the head of the s.e.c.'s ft. worth office painting a much different picture, testifying before a senate banking committee hearing in baton rouge, home to many stanford investors. rose romero of the s.e.c. insists in her prepared testimony that the s.e.c. followed up on all of the tips and complaints. louisiana senator david vitter, who chaired that hearing in august, is not pleased by the contrast, noting kotz makes the point repeatedly that no meaningful effort was made to investigate. an s.e.c. spokesman says the agency, and this may be news in itself, agrees with the inspector general's assessment that no meaningful effort was made but insists, just as chairwoman mary schapiro said on friday, that meaningful changes have been made at the agency. but maria, that is no comfort to
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28,000 victims. >> absolutely. scott, thanks very much. scott cohn with the latest there. microsoft and a big reading on inflation could move the markets tomorrow. we'll tell you what to expect, get you set up for that opening bell. you're watching cnbc, first in business worldwide. and choose any car in the aisle. choosing your own car? now, that's a good call. go national. go like a pro. french fries and america's passion for them are legendary. but times change and people want better foods. so cargill helped a restaurant chain create a zero trans-fat cooking oil for
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>> announcer: here's what to watch for tomorrow. well, the tech earnings parade continues with a vengeance. i'm jim goldman here in cnbc's silicon valley bureau. we've got yahoo and apple, ibm already in the books. come thursday we'll set our sights on microsoft and amazon, both after the bell. >> i'm diana olick in washington. we're just nine days from the end of the home buyer tax credit. how will that affect existing home sales? we'll find out tomorrow morning at 10:00 a.m. from the national association of realtors. >> rick santelli on the floor of the cme group. tune in tomorrow 8:30 eastern for march ppi. it's going to be a lot different than last month. we're looking for the headline number to be up close to half of 1%. and if you don't strip out food and energy year over year, that could be a whopper also. tune in. and we've got some weak guidance after the close tonight, and that seems to be pressuring the stocks involved. we told you we have earnings from ebay as well as qualcomm. and look at ebay right here, down 8%.
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the company lowered guidance. the stock down better than 8%. for the first quarter they came in with earnings of 42 cents a share. it was only one cent better than estimates. revenue also real close to estimates. 2.2 billion for the quarter versus an estimate of 2.18 billion. and as i mentioned they cut guidance to the second quarter to a range of 2.15 to 2.2 billion on revenue. and they also cut guidance on earnings. now, the stock is getting hit as a result of that weak guidance. qualcomm's a similar story. take a look at qualcomm. the company reported earnings of 59 cents a share. better than the estimates of 56 cents a share, but again, it's the outlook that is troubling investors tonight, and that has the stock down 7.5%. revenue also coming in at 2.66 billion close to the estimate of 2.63 billion. but again, it really is the outlook on the next quarter and the year that has investors selling the stock tonight on qualcomm as well as ebay. two names to watch for tomorrow's trading session. meanwhile, the market higher today although just by a
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fraction, reversing earlier losses. i'll see you tomorrow on "closing bell." have a fantastic evening, everybody. "fast money's" up next, right now. live from the nasdaq marketsite, this is "fast money." did apple ring the top of the markets after the iphone maker's blowout report last night? tonight these traders are facing a plummeting ebay, a diving netflix and an even worse qualcomm. let's see how they deal with it right now. pete, what are you making of all of this action? >> well, i think it's exactly what we had talked about last night. when you report earnings right now, people expect a lot more than just in line, and that's what a lot of the folks that are getting slammed recently have been giving us. in line. and then when you start to look at some of the projections going forward, if they're not strong enough they will hit the stock. that's because of the fact that these stocks are all moving up. you look at the s&p 500, near the 52-week high. right above 1,200 or right around in that range. so people are looking for a reason on why they should maybe lighten up. if they don't get the proper
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guidance, they're going to hit the stocks. >> i'm going to go back to the question at the top of the show, did apple ring the top? have stocks been priced for perfection so at this point we're getting bad guidance and we're seeing the sell-off here? >> no, it's a tale two of cities, tale two of stocks. if you're in expectations, that's not good enough. in january, remember, no matter what you did, beat the numbers, gave upward guidance, stocks went down. this is a big difference between what is being said when you had an apple last night and ebay. i'm just going through the ebay stuff. this ebay miss smells to me that this should have been a prerelease. >> why? >> this should have been a prerelease because you should have had a situation -- the guidance is so bad, given what was expected here, this should have come out before tonight's earnings release. they're take the numbers down. the estimates were like $1.67 of earnings. to come out and say you're going to earn between $1.29 and $1.34, in my mind that's a violation of what the spirit of reg fd was about. >> breaking news that schapiro said there's no time to hear the political events.


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